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How can you prioritize SLAs for review and renewal?

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Service level agreements (SLAs) are essential for IT outsourcing, as they define the expectations, responsibilities, and performance standards of both parties. However, SLAs are not static documents that can be ignored once signed. They need to be reviewed and renewed regularly to ensure they reflect the changing needs, goals, and challenges of the IT outsourcing relationship. How can you prioritize SLAs for review and renewal? Here are some tips to help you.

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Alex Danobrega

Acct. Director, Champions of Change | Information Technology | Business | Change Management
Rashitkumar Patil

SAP Project and Program Management, SAP Techno Functional, Transition Management, Transition Solution Architect
Sergio Hartenberg

I help companies to identify and implement Digital Strategies that astonish clients, excel in operations and generate…

1 Assess the current SLAs

The first step is to evaluate the current SLAs and how well they are meeting your needs and those of your IT outsourcing provider. You should consider factors such as the scope, quality, availability, reliability, security, and cost of the IT services, as well as the feedback, communication, and escalation processes. You should also measure the actual performance against the SLA metrics and identify any gaps, issues, or opportunities for improvement.

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Alex Danobrega

Acct. Director, Champions of Change | Information Technology | Business | Change Management
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To prioritise SLAs for review and renewal, categorise them by criticality and business impact. Start with those affecting core operations or nearing expiration. Gather stakeholder input and align SLAs with current business goals and metrics. Focus on high-impact and financially significant agreements. Set a regular review schedule and maintain open communication with service providers. Regular, strategic reviews ensure SLAs continue to meet evolving business needs.

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2 Identify the critical SLAs

The next step is to prioritize the SLAs based on their importance, impact, and urgency. You should rank the SLAs according to how critical they are for your business objectives, how much they affect your customer satisfaction, and how soon they need to be updated or renegotiated. You should also consider the risks and costs of not reviewing or renewing the SLAs, such as potential breaches, penalties, disputes, or loss of competitive advantage.

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3 Plan the review and renewal process

The third step is to plan the review and renewal process for each SLA, taking into account the priority, complexity, and duration of the task. You should allocate sufficient time, resources, and budget for the process, and involve the relevant stakeholders from both sides. You should also establish clear objectives, criteria, and expectations for the review and renewal process, and communicate them to your IT outsourcing provider.

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Rashitkumar Patil

SAP Project and Program Management, SAP Techno Functional, Transition Management, Transition Solution Architect
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Its better to have a monthly service performance review with all the stakeholders from both sides where agreed SLAs are reviewed to see the actual performance in adhering the service levels. Not just to evaluate main variations. Additionally, based on the SLA performance by service provider are achieved consistently or not and accordingly revised. Lastly either half yearly or yearly review to see all SLA parameter are set as per the current business need as business needs rapidly change so SLAs set a year back may not be required or become more important. Such reviews help organisations to come out with better services to their customers

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Sergio Hartenberg

I help companies to identify and implement Digital Strategies that astonish clients, excel in operations and generate new business models.
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I suggest a monthly analysis of every agreed SLAs. Not just to evaluate main variations, but to ensure if these indicators make sense, as well as their expected values. Often, some SLAs are reached with ease by the service provider, and therefore should be revised upwards - and vice-versa. I also suggest an annual SLA review, in order to ensure that all critical processes are covered, such as lead times to start projects or to replace critical, outsourced talents. It is a great opportunity to question the effectiveness of these indicators.

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4 Negotiate the new SLAs

The fourth step is to negotiate the new SLAs with your IT outsourcing provider, based on the results of the review and the agreed objectives. You should aim for a win-win outcome that balances your needs and interests with those of your IT outsourcing provider. You should also be flexible, realistic, and collaborative, and avoid making unreasonable or unrealistic demands. You should document the new SLAs in a clear, concise, and consistent manner, and ensure they are legally binding and enforceable.

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5 Monitor and manage the new SLAs

The final step is to monitor and manage the new SLAs, and ensure they are implemented and followed by both parties. You should track and measure the performance of the IT services against the SLA metrics, and report and resolve any issues or deviations promptly. You should also maintain regular communication and feedback with your IT outsourcing provider, and address any concerns or suggestions for improvement. You should also review and adjust the SLAs periodically, as needed, to keep them relevant and effective.

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6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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How can you prioritize SLAs for review and renewal?

1

2

3

4

5

6

1 Assess the current SLAs

2 Identify the critical SLAs

3 Plan the review and renewal process

4 Negotiate the new SLAs

5 Monitor and manage the new SLAs

6 Here’s what else to consider

IT Outsourcing

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How can you prioritize SLAs for review and renewal?

1

2

3

4

5

6

1 Assess the current SLAs

2 Identify the critical SLAs

3 Plan the review and renewal process

4 Negotiate the new SLAs

5 Monitor and manage the new SLAs

6 Here’s what else to consider

IT Outsourcing

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